Organisational Change in Anz Bank

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So in the initial phase the “brand integration and simplification programme” was complete, which includes the shift to one core banking platform. It took them years with all the planning and investing to made things simpler for customers by creating one management structure. The goals, values and objectives of the manager’s decision-making were classified and ranked by ANZ management team according to their importance. For Instance, one of the major focus was on reducing costs which has been reduced in the recent years by streamlining head office management and processes. Also, to achieve their cost savings goal more saving would come from eliminating duplicated information costs under the new computer system.

Institutional Perspective:

In institutional approach changes become necessary because of industry standards which also includes social and cultural pressures. It considers the process by which structures, including schemes, rules, norms, and routines, become established as authoritative guidelines for social behaviour.

Social and culture pressure on ANZ:

ANZ has taken major steps to change culture after scandals, following revelations of misleading financial advice, insurance fraud, toxic culture and alleged interest-rate rigging.

Therefore, ANZ decided to change its culture by introducing a new pay structure. They are moving away from their traditional rewards centred on profit and loss by directing its focus on rewards for collaboration. In their monthly meetings of the management committee culture is now a standing item.

Less ‘would you like fries with that’ and more ‘needs-based conversations’ is now the focus of ANZ staff as the bank changes it remuneration structure.

For Instance; the bank has drastically changed the way it pays its staff so that the employees are not focusing on hard selling products & services to the customers who don’t really need them. Earlier 50% bonuses of the staff were derivative of how much they sell. Presently from the last year this portion holds to only 25% to 30 %.

“If you want to be in and out [of a branch] and are in a hurry, they’re not going to try to stop you by having a conversation about something you don’t want,”

Also, in recently surveyed employees at several Anz branches across the country, it found 77% felt pressured to sell beyond customer’s needs. The survey outcome indicates that the unreasonable amount of pressure being put on staff for sales. They are changing it too.

For Instance; If a customer who is getting his first loan from his savings, and the employee behind the counter has recognised that ,they will not force the customer rather they will ask them if they want conversation about that later and want to come back. Transformation in the structure of the pay will also motivate employees to target better those they could call.

Also, if they know someone has come to attend their home loan seminars and are interested in buying a house. They will not push the customer for sales but rather will say, ‘If they want to come in the branch and discuss whether they are eligible for mortgage pre-approval?’

2.2 Change Curve:

Status quo: In the first stage of the change curve the first reaction to change is usually shock.Theay are left in denial and shock and at this stage it is common for people to convince themselves that the change isn’t actually going to happen, or if it does, that it won’t affect them.

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For instance, this is exactly what happened when ANZ announced its merger with the National Bank. The employees were kept in dark for too long about this change and when it was finally declared they were left in the second stage of change curve of disruption. They were afraid that they may lose their jobs or how will they adapt to the new system. At this point performance is at its lowest. They were fearing the negative consequences of change and identifying the real threats to their position. As a result the whole organization faces disruption and if not managed carefully can lead to chaos which is exactly what happened with ANZ. This period can be associated with:

- Apathy

- Isolation

- Remoteness

- Suspicion

- Frustration

ANZ did a lot of efforts to convince employees to stop focusing on what they lost. During the early part of this stage, energy and productivity remains low, but slowly begin to show signs of recovery. Slowly and steadily employees start to let go and accept changes. They began testing and exploring changes that how it is going to benefit each of them and how they must adapt to changes. The primary feelings at this stage are:

- acceptance

- hope

- trust

Finally in the rebuilding and commitment stage employees not only accept the change but also start to embrace them.Therefore,the merger was ranked as success as the earnings started to grow strongly. The bank achieved more synergies as thy originally estimated and dual brand strategy started to work well. The staff engagement scores were reported well and therefore the customer satisfaction improved with good credit quality.

2.3 Kurt Lewin’s Change Management:

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When ANZ announced merger with the National Bank it was the unfreeze stage for the employees because many people will naturally resist change. The most vital thing during the unfreezing stage is communication so that employees can be conversant of the sudden change, they should be told why the company is changing its policies and how it is going to benefit each of them.

Communication is very important to execute the intended change so that changes become permanent and reach the refreezing stage. Like in this case, the communication was not clear with the employees of the organisation and they were kept in dark for too long about the merger and changes. So it difficult for them to apply the intended changes.

During the change state most of the bank employees will struggle with the new reality and it is marked with uncertainty and fear and this is the hardest thing to overcome. The more prepared the organisation is for this step, the more easier it is to execute properly.ANZ was not well prepared as most of